Morning News: October 6, 2017
Posted by Eddy Elfenbein on October 6th, 2017 at 7:05 am

Japan Rises as a Free-Trade Leader as the U.S. Sinks

Hurricanes Thought to Crush U.S. job Growth in September

Treasury Road Map for Market Rules Is Said Ready for Release

How Regulators Plan to Curb 400% Interest Loans

Elon Musk Says Tesla Could Get Puerto Rico’s Lights Back On

Freeze Your Credit, Retire Richer

Why Netflix is Raising Prices Again and What it Could Mean For Cord-Cutting

Whirlpool Scores Victory in Battle Against South Korean Washing-Machine Makers

Facebook is Spending $1 Billion for a Building That Basically No One Will Work In

Boeing Takes Another Step Into the Pilotless Plane Market

Major Canadian Pipeline Project Is Abandoned

Ford Delays Fiesta Recall in China Due to Spare Part Issues

HSBC Traders Used Code Word to Trigger Front-Running, U.S. Says

Mark Hines: 3,811 US Stocks, How Do You Pick Yours?

Josh Brown: Why Are European Stocks Chronically Cheaper Than US Stocks?

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How to make money in calm markets
Posted by Eddy Elfenbein on October 5th, 2017 at 9:01 pm

Why the bank rally could continue
Posted by Eddy Elfenbein on October 5th, 2017 at 8:19 pm

Netflix jumps on price hike
Posted by Eddy Elfenbein on October 5th, 2017 at 4:42 pm

Possible Record Low for the VIX
Posted by Eddy Elfenbein on October 5th, 2017 at 12:19 pm

The Volatility Index (VIX) could hit an all-time low close today. The records go back to 1990.

The current lowest close on record is 9.31 from December 23, 1993.

Intra-day, we’ve been below 9 twice, once in December 1993, and again this past July. On July 23, 2017, the VIX fell to lowest intra-day mark on record at 8.84.

Lagging Staples
Posted by Eddy Elfenbein on October 5th, 2017 at 11:23 am

Here’s the Consumer Staples Sector ETF (XLP) divided by the S&P 500. The staples have lagged the market for 18 months.

Signs of a Top
Posted by Eddy Elfenbein on October 5th, 2017 at 11:18 am

A biotech company changes its name to Riot Blockchain and the shares double in a week:

Nasdaq-listed Bioptix, which previously had as its main business the development of a follicle-stimulating hormone for cows, horses and pigs, took a page out of the same playbook by changing its name to Riot Blockchain. Cryptocurrencies are hot stuff and the company is even investing in a Canadian trading platform for them.

Its shares went as high as $9.50 on Wednesday or more than double their price a week ago. Investors should make hay while the sun shines.

I think I know how this story ends.

Morning News: October 5, 2017
Posted by Eddy Elfenbein on October 5th, 2017 at 7:08 am

Brexit Bridge Must Be Set by Christmas, Bank of England Official Says

Puerto Rico Is Running Out of Money

Yellen Says Fed Should Make Sure Bank Rules Aren’t Too Burdensome

The White House and Equifax Agree: Social Security Numbers Should Go

Former CEO Struggles to Defend Why Equifax Deserves $7 Million IRS Contract to Prevent Fraud

Foxconn Chooses Wisconsin Town For Its Factory

Adidas Brings the Fast Shoe Revolution One Step Closer

AT&T CEO Makes the Case For Acquiring Time Warner

Amazon Is Testing Its Own Delivery Service to Rival FedEx and UPS

Google’s New Gadgets Come With a Big Helping of A.I.

Saudi Aramco IPO on Track for 2018

Monsanto’s Roundup Faces European Politics and U.S. Lawsuits

Roger Nusbaum: Why Does Larry Swedroe Hate Dividends?

Jeff Carter: Evolution of Equities

Michael Batnick: Lost in The Shuffle

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ADP Jobs Report: +135,000
Posted by Eddy Elfenbein on October 4th, 2017 at 11:54 am

The big jobs report is this Friday morning. Every Wednesday before the jobs report, we get a preview from ADP, the payroll people. They release their employment report which only covers private sector jobs.

This morning, ADP said the US economy created 135,000 private sector jobs last month. That was 10,000 more than forecast. This was the worst month for new jobs since last October, but it was still better than expectations. Obviously, the recent storms had an impact.

Job growth was concentrated at larger firms, with businesses that employ 500 or more workers growing by 79,000. Smaller firms seemed to be hit the most by the storm damage, as companies that employ fewer than 50 workers saw their staffing decline by 7,000.

On the other side, goods-producing firms saw a sizable boost in hiring, gaining 48,000 positions thanks to a jump of 29,000 for construction as well as 18,000 new positions in manufacturing. Mining and natural resources also continued to grow, adding 1,000.

Not surprisingly, services accounted for the bulk of the job growth at 88,000 new jobs. That was led by a gain of 51,000 in professional and business services. However, the sector was held back by a decline of 18,000 in the usually strong trade, transportation and utilities sector and a drop of 11,000 in information services.

Here’s the recent trend. The ADP report is the blue bar. The red bar is the government’s.

Note that the red bar isn’t the full NFP number but just the private sector.

RPM International Earns 86 Cents per Share
Posted by Eddy Elfenbein on October 4th, 2017 at 11:27 am

This morning, RPM International (RPM) reported Q1 earnings of 86 cents per share. That was two cents above expectations.

“We derived significant benefits from the nine acquisitions made in fiscal 2017, along with our selling, general and administrative (SG&A) cost reduction actions taken last year. Rising raw material costs negatively impacted gross profit margins. As a result, we instituted price increases, which began to take effect late in the quarter. After three years of foreign currency headwinds attributable to the strengthening U.S. dollar, currency translation was essentially neutral this quarter,” stated Frank C. Sullivan, RPM chairman and chief executive officer.

This was for their fiscal Q1 which ended in July. Previously, RPM said they see Q1 earnings ranging between 83 and 85 cents per share and between $2.85 and $2.95 per share for the fiscal year. At the time, that disappointed investors. Wall Street had been expecting 89 cents per share for Q1 and $3 per share for the fiscal year.

The company reiterated their full-year forecast of $2.85 to $2.95 per share. With hindsight, we can see that the disappointment wasn’t far below Wall Street’s original take. The shares are currently down about 1.5%.